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County considering new economic development policy, closer ties to city

Monday, January 23, 2012 by Michael Kanin

The Travis County Commissioners Court is set to replace its expired economic development policy. The new version will include key changes in the way the county approaches economic development incentives. In the process, it may find the jurisdiction heading into closer cooperation with the City of Austin.


That news came as the court addressed the issue at last week’s meeting. County Judge Sam Biscoe set final approval of the new policy for Feb. 7.


Austin Chamber of Commerce Senior Vice President of Economic Development Dave Porter was pleased with the court’s effort. “I think that this is going to come in very handy in 2012,” he said.


The county’s existing economic development policy expired in September 2011. Efforts to update or replace it date back at least as far as a December 2010 draft of a new policy. That version of the document did not come forward.


Katie Petersen Gipson, Travis County’s senior budget and planning analyst, offered the court a memo where she outlined the highlights of the new plan. In it, she singles out a planned formal application process for projects looking for development incentives, definitions of the type of facilities that the county would like to attract, “clearly outlining required and preferred criteria for these projects,” a tiered system of incentives, and “a more defined process for consideration and approval of economic development agreements.”


Should the incentives pass as is, eligible firms would receive an abatement of between 25 and 50 percent, depending on the dollar amount of their local investment. The incentives are currently broken into three tiers, one for an investment of $25-$100 million (the 25 percent abatement category), one for $100-$200 million (37.5 percent abatement), and one for $200 million and above (50 percent abatement).


A draft of the new policy lists convergence technologies, creative media, green industries, a corporate or professional headquarters, healthcare and life sciences, “regional live entertainment or fine arts,” or a research and development group as industries that would receive county preference.


City of Austin Economic Growth and Redevelopment Services Director Kevin Johns and Deputy Director Rodney Gonzales were on hand to discuss the new policy. “We’re here to partner with you whenever possible,” he said. “We can get a lot more bang for our buck and be much more affective if we work together and we don’t duplicate or have an overlap.”


Gonzales agreed. “We look forward to working with the county on future economic development partnerships,” he told the court. “What we wanted to offer today…was future partnership opportunities to eliminate duplication of efforts in terms of economic development.”


He offered to assist the county with reviewing its economic development applications. Gonzales also suggested that the jurisdiction engage in “dual WebLOCI analysis.”


WebLOCI is the tool that city officials use to evaluate that potential fiscal impact of a firm’s economic development proposal.


Despite his overall approval of the effort, Porter did express some concern over a handful of issues. “The tier system is great, it’s more flexible,” he said. “But there’s a big gap between the $25 million and the $50 million (investment levels) to get to the next level.”


Porter also worried about “the requirement to hire 50 percent of the new jobs from Travis County.” He added that the chamber was also “a little bit concerned” about the $1,000 fee that the county would charge per application.


The interim head of Travis’ Planning and Budget Office, Leroy Nellis, argued that the figure was more than reasonable, considering the amount of staff time that county employees put into reviewing each economic development package.

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